Fixed rate electricity
Expert tips on finding the best fixed rate electricity plan
Our Head of Energy, Meredith O’Brien, has some tips on finding a fixed rate electricity plan for your household.
Meredith O'Brien
Head of Energy
Look for sign up incentives
Some electricity retailers might offer discounts and other incentives when you sign up for a new plan. When you’re looking to switch, compare your options and see if there are any potential savings.
Read the contract terms
The term duration of your fixed rate is generally between one to two years, and there might be exit fees if you decide to switch to another plan or retailer before that term is up. For this reason, reviewing the contract terms and conditions is important when you’re looking to switch to a fixed rate electricity plan.
Review your plan when the term ends
Your electricity retailer might switch you over to a standing offer when the term of your fixed rate plan ends. Standing offers (otherwise known as default offers) have rates set by energy regulators to protect consumers and are generally more expensive than market offers that may offer cheaper rates, discounts and other incentives. The Default Market Offer (DMO) is a maximum price regulation benchmark to protect consumers on standing offers, this is also known as the Victorian Default Offer (VDO) if you live in Victoria. These typically aren’t the most competitive offers, so it’s worth comparing your options when your current plan is coming to an end.
What is a fixed electric rate plan?
A fixed electric rate plan is one that guarantees your usage and supply charges across the term of the plan, which is generally between one to two years. Unlike a variable rate plan, a fixed rate plan’s prices won’t fluctuate with the market, providing more price certainty for households.
Is fixed rate electricity better than variable rate?
It depends on your living situation and electricity usage. Here are some pros and cons of selecting fixed rate electricity prices over variable rates:
Pros of fixed rates
- Locking in a fixed rate could help you avoid pricing fluctuations driven by wholesale price changes, inflation, infrastructure and environmental costs over the term of the plan.
- More predictable usage and supply charges over a fixed billing period, which may be better for budgeting.
Cons of fixed rates
- Fixed rate plans may have higher electricity rates and daily supply charges than variable rate plans.
- You won’t save money if underlying pricing factors such as wholesale prices decrease while you’re on this type of plan.
- You may incur an exit fee if you switch providers before the end of the fixed term.
Are fixed rate electricity plans available in my area?
Fixed rate electricity plans are available in the following deregulated states and territories:
- South East Queensland
- New South Wales
- The ACT
- Victoria
- South Australia.
Meet our energy expert, Meredith O’Brien
As the Head of Energy at Compare the Market, Meredith O’Brien believes in educating Australian customers about the everchanging gas and electricity market so they can adjust their energy usage habits and get the most out of their energy plans.
Meredith has six years within the energy industry, following 15 years of experience in financial services and is currently studying a Master of Business Administration. Meredith is a dedicated customer advocate who is passionate about empowering Australians to find the right products to suit their needs by removing the confusion from comparing.